Oral Answers to Questions

Debate between Vince Cable and Toby Perkins

Thursday 11th September 2014 Commons Chamber

[Vince Cable]

The issue of rateable valuation will arise in the revaluation, when it occurs, but my hon. Friend will be aware that pubs have benefited significantly in the autumn statement from the package on business rates, which is worth £1 billion. A third of all pubs have now benefited from the £1,000 discount given to low-value property.

[Toby Perkins (Chesterfield) (Lab)]

The Opposition very much welcome the news that the Government are bringing forward a new pubs code in the small business Bill—we would, because we have asked for it on three occasions, and the Secretary of State has voted against it. He will know that there is concern that the appeals mechanism gives tenants the opportunity to have a “Here’s what you could’ve won” review of their appeal without any right to question it. There is also a sense that the small, family-owned brewers are being brought into a problem that they did not make. What representations has he had on the Bill, and can he give us any assurances that it will satisfy people who are worried about our pubs, so that we do not have to keep returning to the issue, and so that the industry has certainty on what the future in the next Parliament will look like?

[Vince Cable]

We have no wish to create problems for the small, family-owned pubs, which are an extremely important part of the industry. The hon. Gentleman will be aware that one cornerstone of the proposals is the free-of-tie rent assessment, which does not apply to pubs with smallholdings. Small, family-owned pubs are already subject to the voluntary code. In a sense, it would be right for tied pubs of all kinds to be given some protection.

Oral Answers to Questions

Debate between Vince Cable and Toby Perkins

Thursday 10th April 2014 Commons Chamber

[Vince Cable]

In many respects, the Welsh economy is sharing in the wider picture. Its unemployment rate is slightly lower than the national average. My hon. Friend the Member for Ceredigion (Mr Williams), who represents that area of Welsh Wales, is very active in promoting that part of the country, which benefits substantially from European assistance.

[Toby Perkins (Chesterfield) (Lab)]

The trend across the UK that the Business Secretary has just described is undermined by a report that shows it is 100 times easier to get a job in Cambridge than in Salford and that describes the gap as widening “dramatically”. The Public Accounts Committee exposed the incompetence and delays with the regional growth fund. Does not the Secretary of State know that every Tory Government leads to the imbalance in our economy not shrinking, but growing?

[Vince Cable]

Actually, the Greater Manchester local enterprise partnership is one of the best and most active and it is resulting in considerable improvements in that region. On the regional growth fund as a whole, we now have a formidable accumulation of results. We are talking about approaching £3 billion of commitments, 427 projects, more than 500,000 jobs safeguarded and created and, most important, £16 billion of private sector investment that has been brought in alongside Government money.

Oral Answers to Questions

Debate between Vince Cable and Toby Perkins

Thursday 6th March 2014 Commons Chamber

[Vince Cable]

My hon. Friend is right and I thank her for her kind words. Ultimately, what will change the problem is breaking the traditional monopoly of the big four banks. Many new banks are now coming into existence, and the more flexible licensing regime operated by the regulators is playing a significant part. I believe that 20 new banks have recently been licensed and, within a few years, I think we will see real competition and diversity.

[Toby Perkins (Chesterfield) (Lab)]

The Secretary of State says that he is not complacent, and he has good cause not to be. Net business lending was down in eight of the past 12 months, and businesses will hear that in the past year, lending is down by £11.6 billion on the year before. How does he think those businesses will respond to the news that in the past year, Barclays and Lloyds made 508 people millionaires due to the bonuses they paid, at the same time as many small businesses are struggling to get access to finance? Is there a discrepancy between the Government’s performance on small business lending and the bonuses that continue to be paid by those banks?

[Vince Cable]

There are often bonus levels that are extreme, but it is important to recall that at the peak of the financial crisis when the Labour party was in charge, there was a bonus pool of well over £12 billion. That has now shrunk to a tiny fraction of that, and at least one bank to which the hon. Gentleman referred—Lloyds—is making a significant improvement in the supply of small business lending.

Pub Companies

Debate between Vince Cable and Toby Perkins

Tuesday 21st January 2014 Commons Chamber

[Vince Cable]

That was the purpose of the Government consultation. Statutory regulation was necessary, and we consulted on how to do it. We are now evaluating the results of that process. The House will soon hear our conclusions on how to take the matter forward.

Let me repeat my appreciation for the work that has been done by Members from all parts of the House. I also thank the Business, Innovation and Skills Committee, whose Chairman is here, and the various campaigning groups for their work on the matter. It would not be amiss to single out Fair Deal For Your Local, which is the campaign that has been mobilised by my hon. Friend the Member for Leeds North West (Greg Mulholland). As part of his campaign, he has brought together CAMRA, the Federation of Small Businesses and the GMB union as well as various other groups. We are talking about local and national groups across industry and across the country.

[Toby Perkins]

I am grateful to the Secretary of State for giving way and for what he said about me being a statesman. If I may, I will press him on the timetable issue that has been raised. If he accepts that statutory regulation of some sort is necessary and the consultation overwhelmingly supports the majority of such aspects, will he at least commit to some sort of legislative action in the next Queen’s Speech, and will he say that we will not get to the end of this Parliament with nothing having changed?

[Vince Cable]

I cannot really add to what I have already said. The hon. Gentleman knows that we are following a process. I am conscious of the legislative timetable, and he will remember—indeed it is the whole purpose of this debate—that the Government did not consult in an open-ended way over this question; we consulted on a specific proposal to introduce statutory regulation, and that is what we are responding to. Although I am conscious of the legislative timetable, I will not give a specific date on which this report will be concluded.

Oral Answers to Questions

Debate between Vince Cable and Toby Perkins

Thursday 5th December 2013 Commons Chamber

[Toby Perkins (Chesterfield) (Lab)]

Without wishing to show off, I am going to 20 small businesses on Saturday across Chesterfield and Staveley—my wife is bringing her purse.

The urgency of small business Saturday seems all the more serious after a recent report by the Association of Convenience Stores which shows that 55% of its owner members earn less than the minimum wage on an hourly basis. Is the Secretary of State really telling those people that further cuts to corporation tax for big companies are a higher priority than cutting their business rates, which are the most expensive commercial property tax in Europe?

[Vince Cable]

I am very sympathetic to the business groups that have consistently made representations over the past few months to say that business rates are a major burden. This Department has certainly made it clear that we regard it as a major issue. The hon. Gentleman will have to wait for an hour or so to find out what the Chancellor is doing about it.

Oral Answers to Questions

Debate between Vince Cable and Toby Perkins

Thursday 24th October 2013 Commons Chamber

[Vince Cable]

I am aware of this problem in the town centres of my constituency, and I am sure that it is a problem across the country. I repeat that there is an extensive programme of business rate relief. The Government have given local councils the freedom to offer discounts on business rates and we provide a 50:50 matching contribution.

[Toby Perkins (Chesterfield) (Lab)]

Labour is the party of small business—[Laughter.] Conservative Members may laugh, but their party believes that a business that has 300 members of staff is not that large. That shows how out of touch they are. Some 99% of businesses are smaller than that.

Under this Government, 1.5 million businesses have seen business rates rise by an average of £2,000. Our plan to shelve the Government’s 1% corporation tax cut in 2015 and direct all that money towards reducing business rates has won support among organisations from the Federation of Small Businesses to the British Retail Consortium. Does the Secretary of State not realise that many businesses are being crippled by business rates? Why does he not just follow our lead and end the business rate nightmare now?

[Vince Cable]

The hon. Gentleman seems to have forgotten the record of the last Government. I distinctly remember that in one of the last pieces of legislation that I dealt with in the previous Parliament, the Government started to impose business rates on empty property. That was a few months before the collapse in the commercial property market.

Oral Answers to Questions

Debate between Vince Cable and Toby Perkins

Thursday 18th July 2013 Commons Chamber

[Toby Perkins (Chesterfield) (Lab)]

Two years ago, there was a crisis in small business lending. We have just heard from the Secretary of State that in 22 of those 24 months, it has got worse. The Institute of Chartered Accountants in England and Wales is the latest to acknowledge that the Government response to the SME funding crisis is totally inadequate, using a British investment bank that funnels existing inadequate schemes through our uncompetitive banking system. Is it not time that the Secretary of State admitted that the Government will never deliver the scale of change needed and threw his weight behind Labour’s plan for a new generation of local banks with local decision making, based on the key features of the German Sparkasse model? Let us get the real change that British small businesses desperately need.

[Vince Cable]

I am a great fan of the German Sparkasse system, and it is a pity that we never had it in Britain. If the hon. Gentleman looks back on the record of the previous Labour Government, he will recall that in 2000, they had a report prepared for them on the inadequacies of British business lending and the enormous problems created by the fact that four banks accounted for all the business. The Government of the day, despite urging from myself and others, did absolutely nothing about the problem. As a result, we went into the banking crisis with massively over-concentrated ownership and damaged banks that are no longer able to perform properly. We are seeking reform, supporting new challenger banks though the business bank, and dealing with a problem that should have been dealt with a decade ago.

Oral Answers to Questions

Debate between Vince Cable and Toby Perkins

Thursday 13th June 2013 Commons Chamber

[Vince Cable]

My hon. Friend’s example reinforces the general point that I made a moment ago. I cannot pre-judge the outcome of the consultation and we have not yet studied the responses. The Government’s overriding objective is to achieve fair treatment for publicans in respect of rent and beer prices. I think that the mechanism that we have proposed will survive scrutiny.

[Toby Perkins (Chesterfield) (Lab)]

The Secretary of State will be aware that there was a huge Fair Deal For Your Local rally in Parliament recently. It was attended by Members from all parts of the House who support Labour’s view that a statutory code for pub companies must include a mandatory free-of-tie option to hardwire fairness into the system. Is a fairer distribution of risk and reward an objective of the Government’s regulation?

[Vince Cable]

It is an objective of our regulation to achieve a fair distribution of risk and reward. As I have said, the precise mechanism and whether we proceed with the adjudicator in the way that we have suggested very much depend on how we analyse the consultation. The results will of course be discussed in the House.

Oral Answers to Questions

Debate between Vince Cable and Toby Perkins

Thursday 7th February 2013 Commons Chamber

[Vince Cable]

Yes, and I think my hon. Friend makes an important point, which is that although we frequently hear from the prophets of doom on the Opposition Benches, a large amount of entrepreneurial activity is taking place. The percentage of the population engaged in business has increased from about 6% to 9% in the past two years, and what is happening in Gillingham is an example of that.

[Toby Perkins (Chesterfield) (Lab)]

Once again, anyone listening to the recent exchanges will not have the slightest confidence that this Government are taking any meaningful steps that will make a difference. Six weeks ago, in the last Business questions, the Secretary of State told us that after the expert group had met he would come here to tell us the timeline and what was going to happen. He keeps telling us that this bank is going to make a significant difference, but nobody really believes we will see any meaningful progress in the next two years. Certainty and responsibility are very important, so can he unequivocally confirm today that the Government are following the policies that he is advocating on access to finance for small businesses? If not, can he explain what the Government should be doing to make a difference on that?

[Vince Cable]

Of course I can confirm that we are pursuing the policies I have described. I get a sense that the hon. Gentleman has not the faintest idea about the issues involved in establishing a new bank. This Government have established, through government, two new banks, one of which is already operating on a significant scale— the green investment bank. The other is the new business bank, which is going through the necessary processes. [Hon. Members: “When?”] Opposition Members ask when, but do they have the slightest idea what is involved in running a bank and doing due diligence, having presided over the collapse of the banking system ignominiously and having allowed the banks to get totally out of control, with the disastrous consequences that we are now dealing with?

Pub Companies

Debate between Vince Cable and Toby Perkins

Wednesday 9th January 2013 Commons Chamber

[Vince Cable]

As I understand it, there is in any event a specialist use class under the planning regime, which, as it currently stands, provides a degree of protection. We have a programme, which one of my ministerial colleagues introduced a month ago, for supporting community pubs; I do not know whether the hon. Gentleman’s local council and community are taking advantage of that.

[Toby Perkins]

Further to the question that the hon. Member for Burton (Andrew Griffiths) asked, can the Secretary of State clarify whether he is talking purely about pubcos with more than 500 pubs or about pub-owning companies with 500 pubs?

--- Later in debate ---

[Vince Cable]

I have just checked the numbers: it was not two, but six companies that are likely to be affected under the current proposal.

Let me go back over some of the salient facts that led us to this position.

[Toby Perkins]

With respect, the Secretary of State did not get the opportunity to answer my question. Are we talking about pubcos or pub-owning companies?

[Vince Cable]

I think we are talking essentially about the latter—although most of the abuses have happened in the relatively small number of pubcos that happen to have a particular business model—but as I have said, we will define the precise range of companies that will be covered in the consultation.

There has been a contraction of the industry, as the hon. Gentleman acknowledged, from 70,000 pubs in 1980 to 50,000 today. The financial crisis brought into stark relief the slow process of sectoral decline. At present, 18 pubs are closing every week—that is, 18 net; some are opening. Various factors have aggravated the problems of the industry—we have discussed one or two already. The beer duty escalator is one and the outlawing of smoking is another. Many of us supported that measure on public health grounds; none the less, it drove away a certain amount of the clientele. Having voted for those things, I would not criticise them, but we all have to acknowledge that the problems of the pub industry are multiple, and the structure of the industry, which is what we are concerned with in this debate, is only one of those factors.

However, it is undoubtedly the case that the activities of the pubcos, with their highly leveraged business model, have intensified the crisis. These companies were established in the 1990s and started to attract comment and criticism a decade ago. Like an awful lot of other business models that were constructed in the long, artificial, debt-based boom, there did not appear to be a great many problems at the time. With the banking collapse and subsequent recession, the weakness of companies with high debt-to-equity ratios has been rather brutally exposed. What we have seen in recent years is the pubcos trying to retrieve their financial position at the expense of their tenants. We are all familiar with well managed, popular pubs in our constituencies being driven to the wall by, frankly, exploitative financial practices.

--- Later in debate ---

[Vince Cable]

Yes, that is the intention. Our approach would target the companies with the greatest buying power and exempt smaller companies, about which very few complaints have been received. This, too, is a matter we want to pursue in the consultation.

One issue that I would like to clarify relates to the beer tie. Some campaigners, and the motion under debate today, suggest that in order to be effective, we must mandate that all pub companies must offer a free-of-tie option with open market rent review. As I have just indicated to my opposite number, we have an open mind on that matter and will be happy to look at it during the consultation.

[Toby Perkins]

The Secretary of State must recognise that the fact that the original press release ruled out the free-of-tie option will cause some to believe that he is not approaching this matter with an entirely open mind. Will he explain how that happened?

[Vince Cable]

All I can say is that the final version, which I approved and sent out, is the correct statement of where my colleagues and I stand on this.

The evidence suggests that the tie, in itself, is not the issue. It is a valid business model that is used responsibly by companies large and small. It is clear, however, that in some cases the tie is being abused, just as many other business practices can be abused, and it is that abuse that we need to tackle, rather than the tie itself.

There are good grounds for believing that the tie, as such, is not the problem. First, the number of pubs has been declining steadily. The Beer Orders in 1989 and the pubco consolidation in the 1990s resulted in relatively little change in the rate of decline. Secondly, the figures from the past three years, 2008 to 2011, show that the closure rate was lower in tied pubs than in free-of-tie pubs. That is the case regardless of whether we look at the gross or net closure rate, the latter of which takes into account churn by pubcos. Thirdly, the tie does not harm consumer choice. In fact, it sustains and supports the British brewing industry, a successful export industry that has more than doubled since the year 2000.

Oral Answers to Questions

Debate between Vince Cable and Toby Perkins

Thursday 20th December 2012 Commons Chamber

[Vince Cable]

I will certainly ensure that the hon. Lady and her constituent get good advice on the range of opportunities available to them. This is somewhat removed from the immediate concerns in establishing the bank, but she legitimately raises an important issue; many small companies cannot get credit.

[Toby Perkins (Chesterfield) (Lab)]

The small business bank provides the last chance for this Government to take meaningful action that could ensure the vital flow of cash to Britain’s small businesses. The reality among the small businesses that I speak to is that they do not have any of the confidence that the Secretary of State seems to be exuding about the access to finance that is out there. There is a worrying lack of urgency and clarity about the Government’s plans. Will he publish a timetable for the establishment of the business bank and update us on progress with all the main elements that will need to be in place, such as when it will apply for a banking licence, when lending will begin, and when state aid approval will be sought?

[Vince Cable]

There is certainly no complacency. We recognise that there is a very serious problem that ultimately resulted from the collapse of the banks in 2008-09, which has had devastating long-term consequences, and we are seeking to address that with a variety of interventions. There are positive things, including the emergence of challenger banks. When the advisory group meets early in the new year we will set out a detailed plan of action, including dates and objectives. I am happy to brief Labour Members when we have concrete detail.

Sunday Trading (London Olympic Games and Paralympic Games) Bill [Lords]

Debate between Vince Cable and Toby Perkins

Monday 30th April 2012 Commons Chamber

[Vince Cable]

The evidence for the pent-up demand comes from the additional number of visitors; it is as simple as that. We need to ensure that the retail sector can be as flexible as possible.

[Toby Perkins (Chesterfield) (Lab)]

The Secretary of State has gone to great pains to state that this will be a temporary position, and that it is not part of a longer-term Government strategy. I have sympathy for him as someone who has been the victim of briefings from the Treasury, but does he acknowledge that there would be less concern about the measure if the Treasury had not briefed that this would provide an opportunity to determine whether there was demand for further liberalisation in the future?

[Vince Cable]

I am not aware of any such separate briefing from the Treasury. I am working alongside my colleagues on this; it is a Government initiative, not one from any particular Government Department.

Let me turn from the Trojan horse issue to the very genuine religious concerns that have been expressed. The Government are sensitive to the fact that, for many people, Sunday has particular religious significance as a day that is set aside for worship. We have therefore consulted the Churches in advance of the Bill—the Church of England, the Roman Catholic Church and the Church in Wales; Scotland and Northern Ireland have their own separate arrangements—in order to emphasise the temporary nature of the changes. I should add that the Lords Spiritual in the other place did not oppose the measure when they were reassured that this would be a one-off change.

Tuition Fees

Debate between Vince Cable and Toby Perkins

Tuesday 30th November 2010 Commons Chamber

[Vince Cable]

I shall deal with interventions in a moment.

I remind the right hon. Member for Southampton, Itchen that Members from all parties are skating on thin ice when it comes to student financing. He was in the House at the time, so he will remember the pledge on which he campaigned. The right hon. Gentleman quoted our pledge, so I shall quote the pledge on which he campaigned:

“We will not introduce top-up fees and have legislated to prevent them.”

He and his colleagues then voted to do just that.

[Toby Perkins (Chesterfield) (Lab)]

rose—

[Vince Cable]

Wait a moment. I shall deal with interventions later.

There was no coalition agreement. The Labour Government had a majority of 167. There was no financial crisis. At the time, the Chancellor of the Exchequer was going round telling us that Britain was outperforming every Government since the days of the Hanoverians. There was no economic crisis, yet the Labour Government introduced a system that transferred the burden of paying for universities from the state to individual graduates. They introduced it. We are now dealing with a real crisis and we are trying to deal with it in a coalition context. That is the issue the right hon. Member for Southampton, Itchen has to address.

Oral Answers to Questions

Debate between Vince Cable and Toby Perkins

Thursday 8th July 2010 Commons Chamber

[Toby Perkins (Chesterfield) (Lab)]

The Secretary of State will be aware that of all the important things for small businesses, the most important of all is that people have enough money to buy their products. In that light, what impact does he think the increase in VAT will have, particularly on the retail sector, which relies so much on people having the money to purchase products?

[Vince Cable]

The Budget made it very clear that the value added tax increase is part of an overall process of reducing our enormous deficit, and it will lead to the strengthening of the British economy in due course. Those who criticise the VAT increase have to explain whether they are recommending that we make even deeper cuts in public spending instead.

Industry (Government Support)

Debate between Vince Cable and Toby Perkins

Wednesday 16th June 2010 Commons Chamber

[Vince Cable]

I was in Birmingham last week, and people affected by that problem have approached me—indeed, the city council also raised the matter with me—and I have asked for it to be investigated. It is a complex legal problem, but clearly it needs looking at.

I shall proceed to the second statement in the motion with which we agree. The Labour spokesman was explicit, forthcoming and realistic about cuts. The motion reads:

“That this House notes the need for a clear deficit reduction plan”.

It is now going to get one, because on Monday we launched the Office for Budget Responsibility. We now have believable and independent growth numbers on which to construct a budget strategy, and next week the Budget will spell that out in more detail.

[Toby Perkins (Chesterfield) (Lab)]

The Secretary of State will know that he is viewed, in his own party at least, as an economic Nostradamus. Does he seriously expect us to believe that the Office for Budget Responsibility report told him something of which, even with that huge brain of his, he was previously unaware? Most serious financial journalists are saying that the report showed that the previous Government’s forecasts were accurate, so is he seriously telling the House that it led him to a policy so totally different from the one he had been campaigning on for all those months?

[Vince Cable]

That was starting to morph from an intervention into a speech. It did not require a great genius to see the fallacies in the bubble economy that was being created, and I was one of many people who saw the problem. However, the hon. Gentleman is getting to the issue of my position, which was also raised from the Opposition Front Bench, so let me deal with the question of cuts, the timing and what the sensible response is. The motion refers to a

“critical moment in the…cycle,”

and talks about recovery being fragile, and it is fragile. There are risks in both directions. If there are rapid cuts in public spending, they of course run the risk of having an impact on growth; we all understand that, but there is the risk on the other side that if we did nothing or delayed taking action, there would be a serious crisis of confidence in the economy because of the sovereign risk crisis that is rolling around Europe.

I was specifically challenged to say why I had changed my mind on the subject, and I will tell the hon. Gentleman when I changed my mind. Before I entered this Government, I spoke at some length to some of the key decision makers in the UK, including the head of the Treasury, and we also had advice from the Governor of the Bank of England. Their advice was unequivocal: in the circumstances that we entered, we had absolutely no alternative but to act decisively and quickly. I always made it clear in opposition that we had to act rationally. We had to take account of growth on the one hand and sovereign risk on the other. Those factors had to be balanced. We have balanced them, and we came to the decision that early action was essential in the light of the circumstances that exist. That was objectively based on the evidence in the economy.